Pensions - Articles - PPF say COVID19 will have minimal impact on levy charges

 There’s been recent speculation in the media implying that our levy payers will see a significant increase in levy bills this autumn due to COVID-19. We’d like to reassure you this is not the case.

  

 Levy invoices in 2020/21

 The impact of the COVID-19 crisis on the amount of levy we collect this year will be minimal because:

 The rules we use to calculate the levy were fixed before the COVID-19 pandemic

  

 In calculating the levy invoices we’ll be using information that was largely collected before the economic impact of COVID 19 became significant

  

 As in previous years, the most levy we’ll ask any individual scheme to pay is 0.5 per cent of its liabilities.

  

 We recognise the current situation is having a significant impact on businesses globally and that this may create challenges for levy payers, and their sponsoring employers, in paying their 2020/21 levy bill.

  

 So we want to assure you of our support during these unforeseen circumstances. We’re considering all options to find ways we can help and will communicate any decisions we make before invoicing starts.

  

 Levy invoices in 2021/22 and beyond

 We set new rules for levy invoices every year, and haven’t yet done so for 2021/22. We’ll of course be considering all the impacts of COVID-19 carefully as we develop these rules.

  

 At the moment we’re considering the estimated amount of levy we plan to collect, and how we’ll distribute that levy across the schemes we protect. In doing this, we’ll take account of the implications for levy payers whose position has worsened.

  

 Any increase to the amount we collect overall is limited through legislation to a maximum of 25 per cent on the previous year’s figure.

  

 As usual, we’ll be transparent and consult on our plans later this year.

  

 We always plan for the long term and, despite recent significant market volatility, we’re well equipped to weather the storm and future challenges.